New Medicare rule hastily puts rural hospitals at stake

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The Center for Medicare & Medicaid Services (CMS) has recently been working to finalize a proposed rule that would expand Medicare’s use of site-neutral payments, which aims to ensure both hospitals and physicians receive identical payments for the same procedures, regardless of the setting in which the procedure is performed. Sounds harmless, right? However, this proposed rule could have drastic consequences for rural hospitals across our region and the nation.

Under the current system, CMS generally pays more for clinic visits conducted in the hospital outpatient setting than those conducted in the physician office setting, reflecting the much higher cost of running a hospital as opposed to a physician’s office. This proposed rule would result in lower copayments for recipients by cutting Medicare payments to hospitals. If finalized, the proposed change would result in hospitals seeing a projected 60 percent cut to Medicare payments for outpatient services. North Westerners and Americans alike rely on hospitals to provide twenty-four hour access to care. These cuts directly harm facilities that so many members of our communities rely on.

A decrease in funding could cause facilities to become overcrowded and limit services provided by specific hospitals and perhaps lead to the closing of many hospitals. Particularly affected are those in rural areas, where roughly 21 percent of the nation’s population resides. If finalized, the proposed rule creates uncertainty for rural hospitals and in turn, this hardship would ultimately be felt by the communities they serve. Patients in rural areas often don’t have as many options for care as those in more populous regions.

Allowing a government agency to jump in and radically alter the regulatory framework of hospitals and health facilities sets a dangerous precedent, and saddles local hospitals with an unnecessary regulatory burden. Hospitals are not the only parties affected though- it’s the communities, employees, patients and small businesses who rely on these facilities as an economic backbone that will feel the burden of this rule as well.
The CMS should take a step back to carefully consider what’s at stake with this proposal. The ramifications of this rule will hit hard some of America’s most vulnerable, rural communities.

Nansen Malin lives in a remote rural village in SW Washington State. She serves on the local hospital foundation board, in addition to other nonprofit boards focused on serving the elderly and poor in her community.